There is a conception that development is very difficult, we don’t know why it succeeds or fails. My lecture is that it can be done, any state can do it. The story of development is the story of a big lie. Most development aid doesn’t work. Ashraf Ghani said that for every dollar of foreign aid sent to Afghanistan, ten cents reached Afghanistan, 90 cents was spent in the beltway. My own guess had been, 90 cents goes back to the donor country. Development comes when you yourself do it, and that’s what the Singapore story is all about.

There were no celebrations when Singapore became independent; LKY went on TV and cried and apologized. The perception was that no city can survive without its hinterland.

MPH formula

M: Meritocracy. Why is Brazil a world football superpower? They take talent from anywhere, any class, any city or slum. When it comes to looking for economic talent, Singapore goes everywhere. And Singapore takes more time and energy nurturing people at the bottom than anywhere else. Some people say Singapore is elitist, and that’s true, but it’s a meritocratic elite that’s constantly changing. (Joel’s comment: hah! See this previous post for a trivial rebuttal. Plus of course the fact that the current Prime Minister is the founding Prime Minister’s son.)

Singapore compares its lowest 5% of students to other countries; Singapore’s lowest 5% are better. IIT of India trains and develops the best brains in India; the ITE in Singapore is a school of last resort but it won an award. In other countries these students would be finished, but the ITE manages to transform them. (Joel’s comment: or perhaps this tells us that Singapore’s initial assessment of “quality” in children is a poor predictor of future performance)

How does Shell nurture managers? They have a different initialism: HAIR: Helicopter, Analytical, Imagination, Reasoning. In Singapore ministry, they used to rank all 250 people by CEP, current estimated potential. You are supposed to reach your CEP by age 45. So your promotions are scheduled to put you in the highest position you are expected to reach at age 45. As long as there is no personal preference, the system works well. The bottom 5% are then asked to leave. So. Self-fulfilling prophecy much? Here’s some critical thought from a Singaporean, who quotes a US military officer: “The result of this system is that officers are selected and groomed for even the most senior leadership positions in the SAF based on little more than on how they performed as a cadet during OCS and the strength of their high school transcript.” Dean’s analogy: let’s say you are a B-league footballer. If you play in the A league, you cannot run as fast, cannot perform, cannot keep up. [When you cut the bottom 5%] you are being kind to people in some way, by not forcing them …. There’s zero unemployment in Singapore so they still have a job. It takes at least three to five years to assess someone’s potential (this contradicts the link above). The Dean can’t understand why more organizations don’t adopt this system. Do we begin to understand yet why so few minorities have senior positions in Singapore?

“[CEP] is calculated based on a set of 10 criteria. As far as I can remember, they’re – political sensitivity, imagination, sense of reality, communication, leadership, teamwork, respect accorded by peers, ability to handle pressure, problem solving ability and most importantly … the person’s ability to identify problems within the larger context and solve them accordingly.” (source)

P: Pragmatism. Singapore is the best copycat country in the world. And we don’t understand why other countries don’t copy more. Singapore learned the art of copying from the Japanese, who learned it in the 1850s.

Classmate comment: India has this comment. We copied our constitution from other countries in the world. Classmate rebuttal: “But could not implement!”

When you grow up in a colonized country, it is debilitating. I grew up in a British colony. You grow up to believe that you are second class, that your colonizer is always better. Singapore is one of the few countries that mentally decolonized itself very fast. Now we have succeeded so well we are running out of countries to copy. Singapore Airlines is the best airline in the world; who do you copy from? The four tigers copied from Japan, the ASEAN tigers copied from the four tigers. Now Pakistan has implemented state-of-the-art civil reform. (Our Theory and Practice class has made the point that policies from other countries cannot reliably be copied and pasted to other countries with different context or culture.)

After Port of Singapore was told by Rotterdam that they were the best, they became arrogant and lost two big clients (including Maersk) to a nearby Malaysian port. But they became humble and recovered new business and made up the TEU volume.

H: Honesty. Singapore’s biggest competitive advantage. The Dean’s ten commandments for developing countries. Singapore used to be jealous of Sri Lanka. Now we left them far behind. They made many mistakes. They didn’t handle their minorities right. Many countries have huge amounts of oil but so little of the money goes to the government. Except for Norway I suppose.

Three key leaders of Singapore, Lee Kuan Yew, Goh Keng Swee, S. Rajaratnam. All were completely uncorrupt. Li Ka Shing gave the dean a pen; the dean (unbeknownst to LKS) had to pay for the pen, over a thousand dollars, in order to keep it and show it to LKY later.

Corruption in the developing world is illegal; corruption in the developed world is legal. Example: You work at the Pentagon and select a Lockheed Martin bid. After you retire a year later, you get a job at Lockheed Martin. Or take Clinton, who now makes a hundred fifty thousand dollars per speech. Joel’s comment: or take Gerhard Schröder, who went from German premier to Gazprom employee. The day after Greenspan stepped down, he spoke at a hedge fund meeting.

Classmate comment: we fall into the trap of needing individual leaders. But Singapore has succeeded because of the system. Dean: Singapore has developed deep pools of excellence in many fields, which takes years and years. But is this because of the small size and the single level of government? Believe me, any country can do this.